Standard
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FAQs

Is SDA a stable coin?

No, SDA is not a stable coin. Rather, SDA looks to become the top Standard Digital Asset backed by a mixture of standard assets across all markets and industries. Building a diversified treasury with assets both correlated (e.g., BTC, ETH) and not correlated (e.g., precious metals, stocks, real estate) to the crypto market increases the stability of the treasury and SDA coin through bear cycles.

How does it work?

At a high level, Standard consists of a protocol owned and DAO managed treasury, protocol owned liquidity (POL), swap mechanism to add to treasury assets, and staking rewards that are designed to control supply expansion. Swap sales increase the number of assets in the treasury, enabling the protocol to distribute SDA tokens to swappers in exchange.

SDA price volatility?

SDA could trade at a very high price because the market is ready to pay a hefty premium to capture a percentage of the current market capitalization. However, the price of SDA could also drop to a large degree if the market sentiment turns bearish. We would expect significant price volatility during our growth phase so please do your own research whether this project suits your goals.

Do I have to unstake and stake SDA on every epoch to get my rebase rewards?

No. Once you have staked SDA with StandardDAO, your staked SDA balance will auto-compound on every epoch. That increase in balance represents your rebase rewards.

How does the protocol distribute staking yields?

Staking yields are minted and distributed from the treasury. Yields can either be increased or decreased depending on the value of the token, market cap, and value of the treasury.

Why are staking yields so high?

High staking yields provide incentives to holders to not sell the token stabilizing the price. This enables the protocol to issue swaps at a significant discount to incentivize individuals to swap their liquidity for SDA to grow the treasury.
The runway equation was created to estimate how long the protocol could continue providing the same level of yield if no future swaps were purchased where the final day would mean that 1 SDA ≥ 1 DAI.

What is a rebase?

Rebase is a mechanism by which your staked SDA balance increases automatically. When new SDA are minted by the protocol, a large portion of it goes to the stakers. Because stakers only see staked SDA balance instead of SDA, the protocol utilizes the rebase mechanism to increase the staked SDA balance so that 1 staked SDA is always redeemable for 1 SDA.

What is reward yield?

Reward yield is the percentage by which your staked SDA balance increases on the next epoch. It is also known as rebase rate.

What is APY?

APY stands for annual percentage yield. Standard provides yield to stakers that is compounded 3 times per day or roughly every 8 hours. APYs are therefore so high because the protocol is taking in the compound effect of SDA added to the initial principle staked. Over time, the number of SDA staked in the pool will increase exponentially. For example, assuming a daily compound interest of 2%, if you start with a balance of 1 SDA on day 1, after a year, your balance will grow to about 1377!

How is the APY calculated?

The APY is calculated from the reward yield (i.e., rebase rate) using the following equation:
APY = ( 1 + rewardYield )^{1095}
It raises to the power of 1095 because a rebase happens 3 times daily. Consider there are 365 days in a year, this would give a rebase frequency of 365 * 3 = 1095.
Reward yield is determined by the following equation:
rewardYield = SDAdistributed / SDAtotalStaked
The number of SDA distributed to the staking contract is calculated from SDA total supply using the following equation:
SDAdistributed = SDAtotalSupply × rewardRate

Who controls the treasury?

The treasury is controlled by the team at the inception of the protocol. Eventually, the DAO will be launched and members within the DAO will be appointed to control the swap and staking functions as well as the assets within the treasury. More details on this progression in the roadmap.